TEA wants input on financial accountability guidelines

Texas Education Agency spokesperson Debbie Ratcliffe said the agency is currently seeking public input on financial accountability indicators that will form a new financial accountability system to determine the fiscal responsibility of public school systems and charter schools as required by House Bill 5. Those wishing to comment can do so at www.tea.state.tx.us via a survey link on the side of the home page.

The former system used by the TEA to rate financial accountability resulted in “FIRST Ratings” that ranked more than 88 percent of Texas school districts as “Superior” in performance of their fiscal duties in 2012 — including the Beaumont Independent School District, which is now facing state takeover and lower accreditation status due to a scathing TEA investigative report delving into the district’s fiscal practices.

According to TEA information, the purpose of the Financial Integrity Rating System of Texas (FIRST) was “to ensure that school districts and open-enrollment charter schools are held accountable for the quality of their financial management practices and achieve improved performance in the management of their financial resources.” TEA correspondence further notes that the system was “designed to encourage Texas public schools to manage their financial resources better in order to provide the maximum allocation possible for direct instructional purposes (and) also disclose the quality of local management and decision-making processes that impact the allocation of financial resources in Texas public schools.”

However, newly enacted House Bill 5, from the 83rd Legislative Session, directs the TEA to develop a new financial accountability system to correct the flawed system that has been in use to date. House Bill 5, passed in June 2013, mandates changes in the Texas Education Code that now require TEA Commissioner Michael Williams to, “in consultation with the comptroller, develop and implement separate financial accountability rating systems for school districts and open-enrollment charter schools in this state.” The new guidelines should include distinctions based on levels of financial performance and include procedures to “provide additional transparency to public education finance; and enable the commissioner and school district and open-enrollment charter school administrators to provide meaningful financial oversight and improvement; and include processes for anticipating the future financial solvency of each school district and open-enrollment charter school, including analysis of district and school revenues and expenditures for preceding school years.”

Additionally, according to House Bill 5, “The system must include uniform indicators adopted by commissioner rule by which to measure the financial management performance and future financial solvency of a district or open-enrollment charter school … (and) the commissioner shall evaluate indicators adopted at least once every three years.”

Under the new plan, a school district or open-enrollment charter school “shall receive the lowest rating under the system if the district or school fails to achieve a satisfactory rating on an indicator relating to financial management or solvency that the commissioner determines to be critical; or a category of indicators that suggest trends leading to financial distress as determined by the commissioner.”

The financial accountability rating of each school district and open-enrollment charter school under the financial accountability rating system developed under House Bill 5, according to the legislation, shall be made publicly available no later than Aug. 8 of each year,

Public comment and input will be accepted by the TEA regarding the new accountability rating system until May 18. Those logging into the TEA survey (www.surveymonkey.com/s/DQT9V28) will be allowed to offer their suggestions on what three to five indicators could best be used to identify whether a school district or open-enrollment charter school is well managed financially, and what three to five indicators could be used to identify whether a school district or open-enrollment charter school is financially solvent. Information regarding the new accountability ratings or the public input process can be sought had by contacting the Financial Accountability Division of the TEA at (512) 463-9238.

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